Car loans like any type of loan these days are a special event. Banks and car financing companies have a whole new set of standards when it comes to lending money. The old saying that you have to have money to get money is proving to be the new motto of lending companies.
One hundred percent financing has been sent to jail without a get-out-of-jail-free card. The stimulus needed for car loans is the same one needed for home loans, credit card loans, or any type of future business transaction; it’s called equity. Not just any kind of equity but liquid equity, assets that can be converted to cash immediately.
Car Loan Programs
One of the most inventive stimulus car loan programs to be introduced recently is offered by a South Korean car manufacturer who has about three percent of the U.S. auto sales market. Their sales volume has dropped by over thirty-percent this year and they have taken an innovative step to improve business.
What this car manufacturer has introduced is what they call their Assurance Program, which states that if you lose your job, are physically disabled, lose your driver’s license for medical reasons, filed bankruptcy as a self-employed worked or die from an accidental death your new car can be returned to the dealership within twelve months and you can get a refund.
In order to qualify for the program, you must lease or finance the car through their company, be current on the payments and have made at least two payments. If you have a negative cash position at the time you return the car because of depreciation, you would have to pay any amount that is over the $7500 negative-equity threshold they have established. Returning the car should not affect your credit rating. Whether anyone takes advantage of it or not, it is a stimulus and a signal that car manufacturers are remembering they are human.
Car Loans is an Individual Responsibility
New and ingenious ways of increasing business and market share will begin to surface this year and in upcoming years. In order to stay competitive companies will be offering more value, quality, and service. Business is still about money, but the human aspect of each transaction will be considered much more than it has in the past. We now know that everyone can fall into the arms of financial collapse or bankruptcy. No one is immune to the pain of loss and we are all connected in the good times and the bad.
The main stimulus for car loans is an individual responsibility. By acting responsibly and spending what you can afford, you impact the economy in a positive way. Before asking for a car loan, find a way to purchase what you need in cash.
If you have the cash, but don’t want to spend it, use some of it as equity and borrow as little as possible. We are in a cash-based economy where our old cars will become more valuable especially when they are paid for. This new economy will improve the value of your old vehicle and will expand that segment of the auto industry,
The best stimulus car loan package is the one we put in place by taking responsibility for our spending.